Buying a Home? Consider the Cost of Your Commute.

For most perspective homebuyers, there are two very important factors when searching for their new home: cost and location.

You may not realize these two factors go hand-in-hand. The real cost of your home includes a lot more than just the sales price. For instance, if you commute to work every day, there could be costs associated with travel to consider. To avoid making a long-term mistake, do yourself a favor and take the time to calculate all the costs.

Consider this:

If you buy a $200,000 house in a neighborhood that is within walking distance of your work, has easy access to other shopping, grocery stores and entertainment essentials, you could save tens, or even hundreds, or thousands of dollars, as compared to a $100,000 home that requires a 45-minute daily drive to work.

To illustrate the point, consider a round-trip commute of 41 miles each way, five days a week, 50 weeks a year. The cost to operate and maintain an average-sized sedan for this commute is $9,800 per year.1

Only 15 years into paying off your mortgage, you will have spent $147,000 on commuting, as compared to $0 in commuting expenses for the location where you walk to work. That’s also assuming the cost of owning and operating a vehicle doesn’t go up in the next 15 years. These numbers are significant.

Taking an inventory of all expenses associated with your home purchase is so important, and can save you money in the long run. It’s crucial to dive into all the details when looking to purchase a new home.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.